PDL BioPharma Inc (NASDAQ:PDLI) Is A Different Sort Of Biotech Play

PDL BioPharma Inc (NASDAQ:PDLI) is an interesting stock right now. The company is very much under the radar yet has managed to appreciate in value to the tune of 54% over the last six months and more than 62% year-to-date. At the most recent close, PDL went for $3.44 share. At the start of this year, it was down at $2.14 apiece. PDLI Daily ChartThe company's P/E ratio is 7.91 as things stand. Factor in growth and you get a PEG of just 0.4. That's low and suggests that we could see a long-term continuation of the growth that has happened over the last nine months or so, making the stock very much one to watch as we move into the end of 2017 and beyond.From an operational perspective, PDL is something of a unique offering.The company buys various assets in the biotechnology and healthcare space and seeks to generate revenues based on the various monetization methods associated with the assets in question.As an example, during the summer of 2016, PDL completed its first significant equity transaction with specialty pharma company, Noden Pharma DAC. Subsequent to a bit of back-and-forth, PDL now owns 100% of Noden and is working to build it into a substantial revenue-generating platform based on a couple of already approved assets in the hypertension space – Tekturna and Tekturna HCT as they're known in the U.S. and Rasilez and Rasilez HCT as they're known in the rest of the world.These assets will be pushed to the US market by way of an increased sales force this year and are also distributed by healthcare giant Novartis globally, as part of which Noden (and so now PDL) receives a profit transfer from Novartis.Also associated with the Noden transaction is a fresh New Drug Application (NDA) that is targeting the approval of Tekturna in a pediatric indication – a population for which there is a considerable unmet need right now in the US. Approval of this drug is expected at some point within the next six months and this could be a major upside catalyst for PDL as and when it hits press.Outside of Noden, PDL has a subsidiary called LENSAR that specializes in cataract surgery and and markets the LENSAR Laser System for anterior capsulotomy, lens fragmentation and corneal and arcuate incisions, and a portfolio of individual revenue-generating assets acquired over the few years boost top line on a quarterly basis.Net income for the second quarter this year came in at $60.4 million on total revenues of $143.8 million – an increase of close to 600% on the same period a year earlier for this latter figure. At June 30, 2017, cash on hand came in at $435.3 million, up from $242.1 million at December 31, 2016. There's an $89 million "anniversary payment" due to Novartis and paid on July 2, so this will be reflected in the third quarter numbers, but even with this taken into account, a cash balance of close to $350 million is substantial for a company that holds a market cap of just $500 million.Towards the end of September, management announced a $25 million share buyback program that serves to underpin confidence in its operations and capital structure/financial results so far this year.As such, we expect the company to continue to appreciate near-term.There are a couple of risks here and primarily they are rooted in some creative accounting that serves to inflate topline figures somewhat. With that said, however, even with this accounting reversed, revenues come in at just shy of $100 million (as compared to the $143 million mentioned above), which is still a substantial figure for a company of this size and a dramatic increase over the same period recorded a year earlier.Bottom line here is that this isn’t a traditional biotechnology play but with already high and growing financials and a number of key catalysts on the horizon, it could be a rewarding one nonetheless.We will be updating our subscribers as soon as we know more. For the latest updates on PDLI, sign up below!Image courtesy of Maryland GovPics via FlickrDisclosure: We have no position in PDLI and have not been compensated for this article.